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HomeMy WebLinkAboutCORRESPONDENCE - PURCHASE ORDER - 9123488Watson Wyatt's TalentIREWARD Software License and Services Agreement This Software License and Services Agreement (the "Agreement") for Watson Wyatt's TalentIREWARD software (the "Watson Wyatt Software") is entered into by and between: Watson Wyatt & Company ("Watson Wyatt' The City of Fort Collins, Colorado ("Client'), 901 N. Glebe Road a municipal corporation Arlington, VA 22203 215 North Mason Street Fort Collins, CO 80522-0580 The Application, as defined in Section 1(a) below, is made available pursuant to the terms of this Agreement, which includes the terms and conditions that follow and all attachments and exhibits hereto. Terms & Conditions Watson Wyatt's Services. Watson Wyatt shall provide the following services to Client: (a) Implementation Services. Watson Wyatt will configure the Application according to specifications and assumptions set forth in Attachment 1 to create the Client's production instance of the Watson Wyatt Software (the "Application"). Watson Wyatt will migrate the Client's data, as agreed by the parties, into the Application. (b) Application Hosting and Security. Watson Wyatt will host the Application in a computer facility operated by Watson Wyatt or one of its affiliates, and shall permit Client to have access to the Application by means of the public Internet. Watson Wyatt will store data provided or created by Client for access by the Application. Watson Wyatt will back up all data not less frequently than once each business day and will store back-up tapes in secure storage. Watson Wyatt will maintain a disaster recovery program and, in the event of any interruption of services, will use commercially reasonable efforts consistent with its disaster recovery program to restore the computer facility supporting the Application as quickly as possible. Watson Wyatt will maintain the security of the Application as specified in Attachment 4. Watson Wyatt reserves the right to suspend access to the Application (i) for purposes of routine or emergency maintenance, (il) if Client is in breach of its obligations under this Agreement and has failed to cure such breach within thirty (30) days following delivery of written notice of such breach, and (iii) in response to applicable law or an order of any competent governmental or legal authority. For cases involving routine maintenance, Watson Wyatt will endeavor to provide Client with reasonable prior notice of suspension of access. (c) Support Services. Watson Wyatt will provide the support services, set forth in Attachment 1 for any period in which Client has paid the applicable Ongoing Administration and Usage Fees pursuant to Section 3(b). (iii)Watson Wyatt is prohibited from using the e-Verify Program or Department Program procedures to undertake pre -employment screening of job applicants while this Agreement is being performed. (iv)If Watson Wyatt obtains actual knowledge that a subcontractor performing work under this Agreement knowingly employs or contracts with an illegal alien, Watson Wyatt shall: a. Notify such subcontractor and the City within three days that Watson Wyatt has actual knowledge that the subcontractor is employing or contracting with an illegal alien; and b. Terminate the subcontract with the subcontractor if within three days of receiving the notice required pursuant to this section the subcontractor does not cease employing or contracting with the illegal alien; except that Watson Wyatt shall not terminate the contract with the subcontractor if during such three days the subcontractor provides information to establish that the subcontractor has not knowingly employed or contracted with an illegal alien. (v) Watson Wyatt shall comply with any reasonable request by the Colorado Department of Labor and Employment (the "Department") made in the course of an investigation that the Department undertakes or is undertaking pursuant to the authority established in Subsection 8-17.5-102 (5), C.R.S. (vi)If Watson Wyatt violates any provision of this Agreement pertaining to the duties imposed by Subsection 8-17.5-102, C.R.S. the City may terminate this Agreement. If this Agreement is so terminated, Watson Wyatt shall be liable for actual and consequential damages to the City arising out of Watson Wyatt's violation of Subsection 8-17.5-102, C.R.S. (vii) The City will notify the Office of the Secretary of State if Watson Wyatt violates this provision of this Agreement and the City terminates the Agreement for such breach. IN WITNESS WHEREOF, the parties have executed this Agreement as of the Pf, 200 R day of City of Fort Collins, Colorado Watson Wyatt &pCompany v By: . cQ , By: G c—.. L- Si ature) n n ` i ature) Name: Ary S�• �`"�3C< JZ Name: �nI�X�AAH S G-Ik2aL Title: �'2,Zf Ctz 2C,F 6t�c `2CrGC{ i�� Title N-4G -(Na e Date: I cq Dater Jowl-711 a -bll Attachments: Attachment I Services and Assumptions Attachment 2 Fees Attachment 3 Data Center Service Level Agreement Attachment 4 Data Center Technical Architecture ATTACHMENT 1 Services and Assumptions I. Configuration and Implementation Implementation Activities Upon signing of the Agreement, Watson Wyatt will commence with the activities necessary to configure the Application for Client. The key activities conducted by Watson Wyatt in preparation of the system's release to Client are as follows: • Configuration of Client -specific instance of the Application and confirmation of configuration options, replicating Client's existing functionality. • Confirmation of data migration from I-TMS to the Application, to include only Client data presently maintained in I-TMS. • Confirmation of performance management processes as supported by the existing system. • Confirmation of the accurate processing of the weekly data feed from Client's J.D. Edwards to the Application. • There is currently an outstanding support request related to the feed (FOR-615-965). Resolution of this request is included in this migration. This will require coordinated work on the part of City of Fort Collins (e.g. encryption) as well as Watson Wyatt. • Training will consist of a curriculum including sessions delivered via CBT or webcast and three days of instructor -led training at the Client's corporate offices. The focus of the training will be general system usage, performance management and career development for an audience of super users. When the system is ready, Watson Wyatt will release the Application to Client and commence training and user acceptance testing. Implementation Timeline We anticipate that we can have the Client instance of the Application configured and ready for acceptance testing within eight (8) weeks after the signing of the Agreement. Super User training would occur on or about the time the system is made available. We envision a two week period when super users will become familiar with the Application and a three week period for user acceptance testing. This implementation timeline is dependent on the assumptions outlined in the Agreement, and would be impacted by any change in these assumptions. Cost The implementation fee for the system replacement and implementation activities described above is $80,000. However, because Client is a valued, existing client of Watson Wyatt's talent management line of business, we are offering these services for a fee of $40,000. The ongoing fees for the Application will commence on the system acceptance date. Implementation Assumptions Certain assumptions were made in the preparation of this Agreement. Should any of these assumptions be invalid or change, Agreement terms may need to be modified. The assumptions used are: • Watson Wyatt consultants will have access to key decision makers from within Client for the purpose of making configuration and migration decisions, and that these decisions will be made without significant delay. • Client shall select appropriate individuals within its organization to serve as "super users." These individuals will be responsible for answering functional questions about the application within Client and performing various configuration and maintenance tasks once the Application has been deployed. • Client Super Users will be responsible to successfully complete an assigned training curriculum based on their Super User role. This may include any combination of computer - based and instructor -led training events, as well as mentoring, self -guided activities, and reference materials • After system acceptance, Watson Wyatt and Client will work together to schedule the Application go -live in production. Go -five will require I-TMS downtime — currently estimated as five days - during which the final migration will occur. • Client Super Users or other Client Trainers will be responsible for training end users. U. Annual Support Services After Client accepts the Application pursuant to the Agreement, Watson Wyatt will provide the following support services for any period in which Client has paid the applicable annual Usage Fee: (i) Watson Wyatt will correct any material failure of the Application to perform in accordance with these specifications or the applicable documentation and supporting materials for the Application, in a timely manner; and (ii) Online Support. Watson Wyatt shall setup and maintain a dedicated online issues tracking system for each Client for the purposes of submitting support requests and tracking the status thereof. Client can access the online support system at httpW/issues.wyattsd.com/. (Hi) Telephone Support. During normal business hours (9:OOam - 8:OOpm EDVEST, excluding all public holidays), Watson Wyatt will make available reasonable telephone support to Client to resolve any difficulties in the operation of the Application; (iv) Watson Wyatt will apply maintenance changes including fixes automatically as available, and will notify Client of any enhancements available for the Application. Enhancements may require additional fees to activate. M. System Assumptions General Modules Talent management automation including performance SoJlware Product Included management, succession planning / talent review, recruiting, career development, leaming, and applicant tracking. Modules Performance management and learning. Modules currently Initially implemented are Configured Performance and Learning Data . Our system is capable of storing unlimited fields for Not applicable. Requirements employees, jobs, pay and surveys. This requires Existing nightly discussion about the limitless possibilities. It's optimal Deed will be used to have all stakeholders join this discussion at one time. Data Management Project Management Can one data/business requirements session be assumed? ➢ What is the source (or sources) of system data (e.g., employees, jobs, pay, grades, structures, ratings)? ➢ If there is more than one source, will you agree to a standard data import specification? ➢ Is there specific project management, reporting or invoicing protocols? ➢ Will the project be managed by the Compensation / TM function or ff? Talent Management Talent Which talent management processes require Management automation? Automation i ➢ Performance Management Requirements ➢Learning J.D. Edwards HRIS Single source Knowledgeable HR Team is overseeing the effort Modules currently implemented Users and ➢ How many U.S. managers and employees (system I ➢ Over 2300 at Administrators users) will access the Software Product? { last count ➢ How many international line managers and ➢ US only employees (system users)? ➢ In how many locations worldwide do your system ➢ 1 primary, 1 users reside? several local I I I offices { ➢ How many system administrators will you require? ➢ Currently have j 13 super users Languages Do screens need to be in languages other than English? English only If yes, which languages? --1 Process Are your talent management processes mostly uniform Current Diversity across the organization or do your processes vary i performance will be widely? Will you be attempting to bring more 1 ;implemented duplicated as I-- consistency to your processes as part of this effort? i presently --- Manager People Skills — — — -- Do your line managers generally have low, medium, or 'Medium ' high performance management and people development to High { 1 skills? Client Sponsor Who within your organization is the "project sponsor" of Director ofHR ; the talent management system project? e.g. VPHR I I Training We typically utilize a "train -the -trainer" approach. i Strong Infrastructure Would you describe your training infrastructure as strong, medium or low for rolling out training to your I organization? i Programs and Which performance management processes are j Answers are Processes included? I underlined. ➢ Performance planning Yes/No) ➢ Objectives management (YeslNo) ➢ Self assessment Crgs/No) ➢ Competencies and/or skills (Yu/No) j Ratings (_/No) ➢ Year end evaluations (Yes/No) ➢ Mid -year evaluations (Yes/� Do ➢ Development and career planning (Yes/No)* I ➢ Succession planning (Yes/&) ' ➢ 360 or multi -source feedback (Yes/No) 1 ➢ Upward feedback (Yes/ I ➢ Position descriptions and/or job profiles (YeslNo) ' j * = Development Plan is used as a Review Step, but ! i the Career Module (Tab) is not currently enabled. Cycle i What is your performance year cycle (e.g., calendar Calendar year year)? i Do you have different cycles for different employee Yes, by the time groups? that this project begins Competencies ' Do you use a standard competency library? i Yes If so was it built in-house or purchased from a third 1 In-house party? How is it used in the Performance Management process? 1 ds a review step Learning ➢ Do you use 3rd party content providers? If so, which NoYes. Some video Content and how many? ➢ Do develop I content hosted at client and played you online teaming internally? If so, via MS Media i what tools are used? I Player (➢ Do you need to manage licensure, certification, or compliance training? Working on { 1 Certifications; may 1 be in place by the I ---,` ---- _-_( time this erect l Career Data Project Timing System Standards Do you have pre-set curriculums? If so, please I begins describe their typical structure. Yes, typically include a few to several Learning Resources ➢ Do you currently collect data on employee skills? If ! No skills library. so, do you have a standard skills library? Where is I this data kept? ➢ Where is data on career histories, education, etc. kept? ➢ Do you have a means for tracking employee resumes? ➢ What data elements would you like to collect regarding your employees and their backgrounds? ➢ When can this project be started? ➢ When must this project be finished? Not using Career Module No No additional data elements will be collected as part of the migration project Implementation project will begin in January and finish in April2010 Authentication Application level IDs and password are standard. If required we can implement single signon (SSO) (e.g., Netegrity) but fees for SSO will be considered separately. Support The following are examples of services that are not covered under the scope Exclusions of support services. The examples are not intended to be exhaustive: • Custom programming services • On -site support • Performance of actions or administrative functions by Watson Wyatt on behalf of the client, when the client can perform the action or function through the Applicator • Manual file loading or manipulation of any data. Corrections of any failures or data sent from client's HRIS system that were not directed, authorized, participated in, or consented by Watson Wyatt. • Changes to the import file definition or source HRIS system j ! Changes to the business rules applied to the data from the MUS i system i i Support for user's computer operating system software or I configuration, or any installed software • Connectivity problems resulting from failure of Client's Internet I I Service Provider or corporate LAN / WAN. Training i Watson Wyatt Training will include performance management and learning module training. Training will include a combination of computer -based and ! instructor -led training events, as well as mentoring, self -guided activities, and reference materials with the assumption that clients will provide subsequent N+ining• 4—Annual _I Annual Usage Usage Fee includes access to the Application, technical support,, Fee updates and patches, regular web tutorials and application hosting. Major Iproduct upgrades will require additional implementation fees which would be negotiated with Client. Unlimited technical support consists of troubleshooting technical issues where the application does not perform according to specifications (e.g., reports are not running, users have trouble I accessing the application). ! After implementation, additional training is available for an additional fee. ! Changes to configuration, data imports/troubleshoo&4exports, additional ! reports and graphics, future focal window setup and testing as well as other system changes occurring after implementation are not covered by the Annual Usage Fee. Expenses Watson Wyatt will bill any reasonable expenses incurred in performing the I services. These expenses include travel (including meals and lodging), i production costs, printing and the cost of other services or materials j purchased in connection with this engagement. Data center Client will incur the cost associated with independent audits, including fees security audits related to Watson Wyatt's involvement. Hosting Application hosting will be at a Watson Wyatt data center in a shared server configuration. One test and one production environment will be created and imaintained. Access will be provided via the web (no VPN connectivity assumed). j All data is hosted in the United States. We assume Client is responsible for ! compliance to internal and legislated country specific data privacy requirements regarding all employee information provided to Watson Wyatt. No special Procedures, penetration tests, security or hosting methodologies_] i 1 are assumed. I Customizations Software Product may be modified for additional cost to manage special requirements not met by configuration alone. Standard Software Product I functionality is assumed. .� r— Reporting Standard reports are assumed. No custom reports are included in this project Scope. ATTACffiVIEN'T 2 Fees Frill implementation: Total: • See Exhibit l for Assumptions. $40,000 • One half ($20,000) due at contract execution • One half (520,000) due at Acceptance Date as defined in 3(f) Ra - AM - _- • Customization Fees: Standard functionality is assumed. No customization is expected. $0 • System Integration: existing data feed will be continued $o • After implementation, additional training, configuration or data related services are optional available for an additional fee • Expenses: in accordance with section 3(c) above, Watson Wyatt will bill all reasonable TBD expenses incurred in performing the services. These expenses include but may not be limited to travel (including meals and lodging), production costs, graphic design, printing and the cost of other services or materials purchased in connection with this Agreement. • Additional Maintenance Fees: maintenance and support services beyond the standard optional services. • Usage Fees include access to the Application, technical support, updates and patches, web Total: tutorials and application hosting. Major product upgrades will require additional See usage fees implementation fees to be negotiated with Client, but any increase in Usage Fees in table in adjacent connection with product upgrades shall be subject to section 3(b). box • When requested by Client, changes to configuration, data imports/troubleshooting/exports, additional reports and graphics, as well as other Application system changes (not then . available in the Software Product) occurring after implementation are not covered by Usage Fees. • Hosting (includes a server and data center support). Should additional modules be purchased or different server configuration be required, hosting fees may increase. • For use with approximately 2,330 employees. Additional usage fees, to be mutually agreed upon, my be charged if the assumptions set forth in this table or Exhibit 1 are inaccurate. ■ Usage Fees: The ongoing cost for the Application will be calculated in US $ per user per month (PUPMI using the following table. User Count — Law User Count— Hi h Rate I 1000 $6 PUPM 1001 4000 $4 PUPM 4001 $2 PUPM • For example, for 2,330 employees, the cost per month would be ($6 ♦ 1000) t- ($4 • I330) = S 11,320 or $135,840 per year. • These Usage Fees will be billed annually, in advance, based on the number of employee records active in the Application. Usage Fees maybe adjusted if the number of employee records increases during the year. Employees or users marked as inactive and test users marked as active on the Application will not be subject to Usage Fees. 2. Client's Responsibilities. Client is responsible for (a) the use and ,operation of the Application; (b) maintaining a telecommunications connection to the internet address provided by Watson Wyatt; (c) obtaining all license rights necessary to use any data or surveys that it uses in connection with the Application, including in the case of third party data, any rights that may be necessary to store such data on Watson Wyatt's computers; and (d) the installation, maintenance, operation, and performance of Client's computer equipment and software used to access the Application. Client shall provide Watson Wyatt with Client's data in the format agreed upon by the parties pursuant to Section l(a). Client shall make its personnel and agents available as may be required to enable Watson Wyatt to provide its services hereunder. If Client is unable to make its employees or agents available or to provide data and information on the schedules and in the formats agreed upon, Watson Wyatt's fees may be higher and the estimated delivery schedule later than specified in this Agreement. Client represents that Client is the controller of any data provided to Watson Wyatt by Client or its agents and that Client retains all responsibility to third parties, including the individuals to which such data relate, for such data. Client is responsible for compliance with any laws or regulations applicable to the protection of such data Watson Wyatt will comply with Client's reasonable instructions in accessing and processing such data. 3. Fees. (a) Implementation Fee. The fees for implementation services are specified in Attachment 2. Watson Wyatt will notify Client promptly if it expects that actual fees will exceed the fees set forth in Attachment 2. Unless the parties agree otherwise and if not specified in Attachment 2, Watson Wyatt's Implementation Fee is due upon execution and must be paid in full before Watson Wyatt commences any configuration services described in Section I(a). Other fees are due when incurred and will be determined taking into account factors that generally include the circumstances relevant to the particular services, the time required to perform the services, the novelty and difficulty of the work, the skill required, the experience and seniority of the associates who perform the services, any time limitations or other unusual conditions that may be applicable, and Watson Wyatt's standard hourly rates in effect at the time services are performed. (b) Ongoing Administration and Usage Fees. Client shall pay Watson Wyatt the Ongoing Administration and Usage Fees set forth in Attachment 2 for the support services and use of the Application beginning on the Acceptance Date specified in Section 3(f), The Ongoing Administration and Usage Fees shall be payable on the Acceptance Date and on each anniversary of the Acceptance Date for the following twelve (12) month period. Watson Wyatt will invoice the annual Ongoing Administration and Usage Fees in advance. The Ongoing Administration and Usage Fees will remain the same for the initial term of the Agreement set forth in Section 8(a), other than adjustments in such fees that may be made to reflect the delivery of additional modules or customizing services, or, if applicable, any increase in the number of Client's users or employee records in the Application. Watson Wyatt may adjust the amount of the annual Ongoing Administration and Usage Fees effective on any anniversary of the Acceptance Date after the initial contract term by giving Client at least 60 days prior written notice of such adjustment. The amount of say single annual adjustment shall not be greater than five percent (5%) of the annual Ongoing Administration and Usage Fees in effect for the immediately preceding contract year, provided however, that the foregoing limitation shall not apply to adjustments in the such fees that may be made to reflect the delivery of additional modules or customizing services, or, if applicable, any increase in the number of Client's users or employee records in the Application. (c) Payment Terms. Watson Wyatt shall invoice Client for all amounts payable under this Agreement. Watson Wyatt charges a technical and administrative fee based on a percentage (currently 7%) of the consulting fees. Unless otherwise specified, such fee is included in the fees set forth in Attachment 2. Invoices shall be due upon receipt, and invoices that are outstanding for more than 30 days shall be subject to a late payment charge to be computed at the rate of one percent (i%) per month on the unpaid balance, unless such invoices are the subject of a bona fide dispute. (d) Taxes. Client shall pay, or reimburse Watson Wyatt for, all sales, use, customs, excise, gross receipts or similar taxes imposed on Client or Watson Wyatt, or required to be collected by Watson Wyatt, in connection with this Agreement, the amounts payable hereunder, or Client's use of the Application. (e) Expenses. Client shall reimburse Watson Wyatt for reasonable out-of-pocket expenses, including travel, incurred in performing the services, unless otherwise agreed. Expense items greater than $100 must be approved by Client in advance. Expenses other than associate travel are subject to an administrative fee based on a percentage of the expenses unless arrangements are made in advance for. such expenses to be invoiced to and paid by Client directly. (f) Acceptance. Unless the parties agree otherwise and if not specified in Attachment 1, Client shall have ten (10) business days after Watson Wyatt makes the Application available to Client in which to reject the Application by giving Watson Wyatt written notice of any material Non -Conformity. A "Non -Conformity shall mean any reproducible failure of the Application to perform according to its description in any applicable specifications approved by Client. If Client rejects the Application, Watson Wyatt shall have thirty (30) calendar days in which to correct the Non -Conformity. If Watson Wyatt fails to correct the Non -Conformity within such period, or such longer period as the parties may agree upon, then Client may terminate this Agreement for cause in accordance with the provisions of Section 8(b) hereof. If Client provides no notice under this Section, the acceptance date (the "Acceptance Date') shall be the date ten (10) business days after Watson Wyatt makes the Application available to Client, unless a different date is specified in Attachment 1. 4. Limited License. Watson Wyatt grants to Client a limited, non-exclusive, non -transferable license to use the Application commencing on the date of delivery and continuing during the term of this Agreement. Client may use the Application to perform internal talent management and compensation management services on behalf of itself and its wholly owned subsidiaries. Client shall not permit any other party to use the Application, and Client shall not use the Application on behalf of any other party. Client shall not, and shall not permit any third party to, (a) decipher or decompile the Application or develop or derive source code for the Application; (b) develop passwords or other mechanisms that enable the Application for equipment, user or periods of time not covered by this Agreement or (c) disassemble, decompile, reverse engineer, transmit, or hack into the Application in any form or by any means. Client shall not assign or sublicense its rights under this Agreement without Watson Wyatt's prior written consent, provided that Client may assign all its rights hereunder to a corporate affiliate or successor as long as the assignee agrees in writing to be bound by this Agreement. Any other attempted assignment by Client of this Agreement or the license created hereby shall be void. 5. Reservation of Rights. This Agreement does not convey to Client any proprietary or other ownership interest in the Application. Client acknowledges that Watson Wyatt owns all copyrights in the Application All of the data provided to Watson Wyatt by Client pursuant to this Agreement or developed hereunder shall at all times remain the property of Client. 6. Warranty, Remedies, Disclaimers and Limitation of Liability. (a) Standard of Care for Services. Watson Wyatt shall perform the services to be provided pursuant to this Agreement with due care and in a workmanlike manner. (b) Warranty. Watson Wyatt warrants that the Application will conform substantially to and will operate substantially in accordance with the Requirements for ninety (90) days from the Acceptance Date. (c) Exclusive Remedies. Watson Wyatt's sole liability and obligation for breach of the above warranty shall be to use commercially reasonable efforts to remedy such breach and to repair or correct the Application within a reasonable time and without charge to Client, but if Watson Wyatt is unable to remedy such breach during the warranty period, Client shall be entitled to terminate this Agreement pursuant to Section 8(b). (d) Warranty Disclaimer. Except for the warranties expressly stated in this Section 6, Watson Wyatt makes no warranties of any kind concerning the Application or the services to be performed hereunder and specifically disclaims the implied warranties of merchantability and fitness for a particular purpose. Watson Wyatt does not warrant that the Application will operate without interruption or that the Application is free from errors. (e) Limitation of Liability. If the Application and any of Watson Wyatt's services do not conform to the requirements of this Agreement, Client shall notify Watson Wyatt promptly and Watson Wyatt shall reperform such services at no additional charge or, at Watson Wyatt's option, shall refund the portion of the fees paid with respect to the Application or such services. If reperformance of the services or refund of the applicable fees would not provide an adequate remedy for damages arising from the performance, nonperformance, or breach of this Agreement, Watson Wyatt's maximum liability, including that of any employee, affiliate, agent or contractor, relating to the services and any claim under this Agreement, regardless of the cause of action, will be limited to direct damages in an amount not to exceed two hundred fifty thousand dollars ($250,000) or, if greater, the fees payable under this Agreement. The limitation of liability contained in this Section shall not apply to Watson Wyatt's indemnity obligations under Section 7(b) or to the extent that any liability arises from the gross negligence or willful misconduct of Watson Wyatt, its employees, affiliates, agents or contractors or from bodily injury, death of any person, or damage to any real or tangible personal property. (1) Consequential Damages. In connection with the software license and any services to be provided hereunder, Watson Wyatt shall in no event whatsoever be liable to Client or any other party for any indirect, special, consequential, incidental, or similar damages, including damages for lost data or economic loss, even if Watson Wyatt has been notified of the possibility of such loss. (g) Third Parties. This Agreement only creates rights enforceable by the parties to this Agreement and does not create any rights enforceable by any other party ("third parties"). Watson Wyatt accepts no responsibility whatsoever for any consequences arising from any third party relying on the Application and services provided by Watson Wyatt. Watson Wyatt shall be entitled to costs and reasonable attorneys' fees incurred in responding to requests or demands by third parties, government agencies or professional bodies, pursuant to legal process or otherwise, for documents, data or information related to the Application or any services provided under this Agreement. Watson Wyatt shall promptly notify Client of all such requests or demands. Watson Wyatt shall only be liable to you for those losses that correspond directly with our share of responsibility for the losses in question. 7. Infringement of Intellectual Property Rights Held by Third Parties. (a) Remedies. If a claim is made against Watson Wyatt or Client alleging that the Application infringes on a patent or copyright, Watson Wyatt shall have the right to substitute a non -infringing alternative software program and materials that perform substantially the same or similar functions in a non -infringing way. If a substitute program is not reasonably available, then either party may terminate this Agreement. If this Agreement is terminated pursuant to this Section 7(a), then Watson Wyatt shall refund a pro rata portion of the Implementation Fee, if any, paid by Client, based on the unused portion of the initial term (as specified in Section 8(a)), together with a pro rota portion of the Ongoing Administration and Usage Fees for the year in which termination occurs. (b) Indemnification. Watson Wyatt shall indemnify and hold harmless Client from any liability for infringement of any United States patent, copyright or other intellectual property of a third party that arises solely from Client's normal use of the Application in accordance with the terms and conditions of this Agreement, provided that Watson Wyatt is promptly notified in writing of any such suit or claim against Client, and provided feather that Client permits Watson Wyatt to defend, compromise or settle any such suit or claim and gives Watson Wyatt all reasonable information, assistance and authority required to do so. (c) Entire Liability; Custom Specifications. This Section 7 states Watson Wyatt's entire liability with respect to infringement of any copyright, patent, or other intellectual property right. Notwithstanding the provisions of this Section, Watson Wyatt shall have no obligation to Client with respect to any claim of infringement to the extent that such claim relates to modifications made to conform to specific instructions or directions provided by Client 8. Termination. (a) Term. The initial term of this Agreement shall extend for 12 months following the Acceptance Date (as specified in Section 3(f)). Thereafter this Agreement shall automatically renew annually on the anniversary of the Acceptance Date unless either party gives the other written notice of termination sixty days before the expiration of the initial or any renewal term. (b) Termination without Cause. Either party may terminate this Agreement after the initial term (as specified in Section 8(a)), including the license created hereby, without cause upon thirty (30) days written notice of termination to the other party, without provision for a termination fee, and upon such termination Watson Wyatt shall refund a pro rata portion of the Ongoing Administration and Usage Fees for the year in which termination occurs. (c) Termination for Cause. Either party may terminate this Agreement, including the license created hereby, for cause immediately upon written notice of termination if the other party has materially breached a provision of this Agreement (including without limitation Client's obligation to pay any fee or charge when due) and has failed to cure such breach within 30 days following delivery of written notice of such breach. (d) Obligations upon Termination. Upon any termination of this Agreement, Watson Wyatt shall transfer to Client all data belonging to Client or its licensors and stored by the Application in Watson Wyatt's computer facilities. Watson Wyatt shall transfer such data in the form in which it exists as of the date of termination of this Agreement by means of electronic transfer to a location specified in writing by Client. Client shall compensate Watson Wyatt at its then prevailing rates and shall reimburse Watson Wyatt for all expenses incurred in connection with the data transfer. 9. General Terms and Conditions. (a) Governing Law. This Agreement shall be construed and enforced in accordance with the laws of the State of Colorado, United States of America, without regards to its conflict of laws rules. The parties agree to waive any right they may have to demand a jury trial. (b) Excusable Delay. Any delay in performance on the part of either party shall be excused and the time for performance extended if, and to the extent that, such delay is due to causes beyond the control of such party. Such causes may include, but shall not be limited to, acts of God, foes, earthquakes, floods, strikes, and wars. Watson Wyatt shall have no responsibility for delays or interruptions in service caused by parties other than Watson Wyatt, including telecommunications carriers and Internet service providers. (c) Notices. Any notices or other communications required by this Agreement shall be in writing and shall be sufficient if delivered by hand or telecopy, or sent by certified mail, return receipt requested, to the applicable party at its address as specified on the first page of this Agreement. Notices shall be deemed given when received or five days after mailing as specified Above, and either party may designate a different notice address in writing. (d) Complete Agreement. This Agreement constitutes the entire agreement betweerr Watson Wyatt and Client with respect to the materials licensed hereby and the services to be performed by Watson Wyatt hereunder. No statement or promise by Watson Wyatt or its employees that is not contained herein shall be binding upon Watson Wyatt. If any provision of this Agreement, is declared to be invalid, such provision shall be severed from this Agreement and all other provisions hereof shall remain in full force and effect. (e) Counterparts. This Agreement may be executed in counterparts. (t) Disputes. Any controversy, dispute or claim of any kind between the parties shall be resolved by binding and final arbitration before three neutral arbitrators. In the United States, the arbitration shall be conducted in accordance with the Federal Arbitration Act (Title 9 of the U.S. Code) and administered by the American Arbitration Association ("AAA) in accordance with AAA's Commercial Arbitration Rules. In Canada, the arbitration shall be administered by the ADR Institute of Canada in accordance with its Rules of Procedure for Commercial Arbitrations. One arbitrator shall be named by each party and the third named by the two party -appointed arbitrators, or, if they should fail to agree on the third, by the organization administering the arbitration. The arbitration will be conducted in the metropolitan area in the State of Colorado where our office principally responsible for providing services to you is located. Judgment on the award of the arbitrators may be entered by any court having jurisdiction. The proceedings shall be confidential. (g) Confidential Information. (i) Confidential Information. Confidential Information shall include all information disclosed by one party (the "Discloser") to the other (the "Recipient') in writing and marked "Confidential' or disclosed visually or orally and subsequently confirmed in writing to be confidential within 20 days after the first disclosure. Confidential Information shall not, however, include the following: (a) information which is now or hereafter comes into the public domain; (b) information learned by the Recipient from third parties; (c) information known to the Recipient or developed by the Recipient independently of information disclosed by the Discloser, or (d) information required to be disclosed by Recipient pursuant to requirements of law or regulation or by order of a court or other body of competent jurisdiction or other legal process. (ii) Confidential Treatment The Recipient shall treat the Confidential Information as confidential, using the same standard of care that it uses to protect its own proprietary or confidential information (but not less than a reasonable standard of care), and shall use reasonable measures to prevent disclosure of the Confidential Information to any third party without the Discloser's consent. The Recipient shall disclose the Confidential Information only to those of its employees, agents or subcontractors who have a reasonable need for access thereto. (iii) Publicity. Watson Wyatt will not use Client's name or logo in advertising, sales promotion or other publicity, but may, for its own marketing purposes, include Client's name in client lists, proposals or other non-public communications made to prospective clients. (iv) Return of Information. All Confidential Information shall remain the property of the Discloser. Upon the Discloser's request, the Recipient shall promptly return the Confidential Information, provided, however, that the Recipient may retain copies solely for archival purposes only. (h) Data Privacy. Watson Wyatt's standard security model for the Application is set forth in Attachment 4. Watson Wyatt is a global business and in performing the services set forth in this Agreement, Watson Wyatt may pass data within its global network of offices. Irrespective of where Watson Wyatt receives or holds personal data on Client's behalf, Watson Wyatt confirms that it will take appropriate technical and organizational measures to protect that personal data against accidental or unlawful destruction or accidental loss or unauthorized alteration, disclosure or access. Watson Wyatt will only use any personal data for the purposes of providing services to Client or for other reasonable purposes which are ancillary to the provision of consulting services. For data file transmissions from EU countries (other than the United Kingdom) to the United States, the European Commission's Model data protection clauses shall apply to personal data transfers under this Agreement. For data file transmissions from the United Kingdom to the United States, the following provisions shall apply. For purposes of these provisions, "Processor" shall mean Watson Wyatt & Company and "Controller" shall mean Client: (i) The parties' attention is drawn to the Data Protection Act 1998, Directive 95146/EC of the European Parliament and any legislation and/or regulations implementing them or made in pursuance of them (all referred to together as the Data Protection Requirements). (ii) Each party warrants to the other that it will duly observe all its obligations under the Data Protection Requirements which arise in connection with the performance of this Agreement (iii) The Processor acknowledges that the Controller is the data controller in respect of any personal data that the Processor processes in the contuse of providing the Services. (iv) The Processor agrees that it shall only carry out processing on the Controller's instructions from time to time and implement appropriate technical and organizational measures to protect personal data against unauthorized or unlawful processing and accidental destruction or loss. (i) To the extent that this Agreement may constitute a "sole source government contract" within the meaning of Section 2(14.4) of Article XXVIII of the constitution of the State of Colorado, about which the City makes no representation, Section 15 of said Article XXVUI, which reads as follows, is hereby incorporated into this Agreement and made a part hereof: Section 15. Because of a presumption of impropriety between contributions to any campaign and sole source government contracts, contract holders shall contractually agree, for the duration of the contract and for two years thereafter, to cease making, causing to be made, or inducing by any means, a contribution, directly or indirectly, on behalf of the contract holder or on behalf of his or her immediate family member and for the benefit of any political party or for the benefit of any candidate for any elected office of the state (of Colorado) or any of its political subdivisions. (j) Prohibition Against Employing Illegal Aliens. Pursuant to Section 8-17.5-101, C.R.S., et. seq., Watson Wyatt represents and agrees that: (i) As of the date of this Agreement: a. Watson Wyatt does not knowingly employ or contract with an illegal alien who will perform work under this Agreement; and b. Watson Wyatt will participate in either the a -Verify program created in Public Law 208, 104th Congress, as amended, and expanded in Public Law 156, 108th Congress, as amended, administered by the United States Department of Homeland Security (the "e-Verify Program') or the Department Program (the "Department Program"), an employment verification program established pursuant to Section 8-17.5-102(5)(c) C.R.S. in order to confirm the employment eligibility of all newly hired employees to perform work under this Agreement. (ii) Watson Wyatt shall not knowingly employ or contract with an illegal alien to perform work under this Agreement or knowingly enter into a contract with a subcontractor that knowingly employs or contracts with an illegal alien.to perform work under this Agreement.